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After Capping Customers, Rogers Tightens The Noose
Overage penalty limit to be lifted from $25 to $50 in March

There's two major reasons ISP executives want to shift from flat-rate to a pricing model where customers face low caps, and high per-gigabyte overages. One, it's a power play to cushion the eventual (if still far away) erosion of TV revenues in the face of Internet video, and to retain market power in the face of Internet content evolution. Two, it's so they can make investors happy by continually jacking up the amount you'll pay per gigabyte -- in polar opposite to the ever-diminishing costs of hardware and bandwidth.

Of course carriers can't possibly admit this to consumers, so they pay PR people and lobbyists to dress up metered billing as altruism, dire necessity, or both. If ISPs aren't allowed to impose this new model, lobbyists argue, the Internet will explode (proven to be nonsense) or perfectly profitable operators won't be able to afford network investment (also proven to be nonsense). It is a pure cash grab, and once U.S. carriers impose their vision of metered billing (not to be confused with a true per-byte model that offers consumer value), you can be certain of one thing: you'll face slowly, consistently higher bills.

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In Canada, companies like Rogers cable have already established what's essentially the dream billing model for mega-ISP investors. On top of a monthly rate that more than covers the cost of the connection and support, Rogers charges customers per gigabyte overages up to $5.00 per gigabye, a nice markup over the pennies the carrier pays for bandwidth. Rogers also tries to keep customers in house by offering a subscriber to any Rogers service a limited catalog of Internet video. Of course the service counts against the cap, so users are penalized the more they use this "free" service.

While carriers often claim these billing models are about fairness to lighter users, you'll note that Rogers lightest customers are offered a 500 kbps tier with a 2GB monthly cap for $26 (plus fees), and users are billed $5 per additional gigabyte. Should grandma simply choose to download one very large file, she faces a monthly bill that could potentially exceed $70 -- for a 500 kbps connection! The entire Rogers model isn't designed with fairness in mind, it's designed to drive the customer base toward ever-more expensive product. It's designed to get customers to pay more money for the same (or less) service.

Rogers originally capped the amount in overages consumers could be billed per month at $25. However, according to customer posts in our forums, the company will be boosting the maximum incurable penalty to $50 a month starting in March. A Rogers spokesperson stops in the thread to confirm the change, adding that Rogers "wants to offer our customers great quality of service for the best value," and that the model is justified by "technology enhancements" and network expansion.

Take a very good look at the "value" provided by the Rogers model, because it's coming to the United States eventually, whether you like it or not. While Time Warner Cable's attempt to impose such a model failed due to consumer backlash, AT&T's still testing low caps and high overages in two markets -- and we may see a more unified ISP push toward this model in 2010.
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bgraham2
join:2001-03-15
Smithtown, NY

bgraham2

Member

Get everyone hooked on the internet then raise prices.

This seems to be the way ISP's are going to get more profit in the future. Costs go down and prices will go up.
gorehound
join:2009-06-19
Portland, ME

gorehound

Member

Re: Get everyone hooked on the internet then raise prices.

Bullshit !!!
They better not even try doing this krap in the USA.

Z80A
Premium Member
join:2009-11-23

1 recommendation

Z80A

Premium Member

Re: Get everyone hooked on the internet then raise prices.

Or what? You go back to dial up?
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Angrychair
join:2000-09-20
Jacksonville, FL

3 recommendations

Angrychair to gorehound

Member

to gorehound
First they came for the clec's -- and I did not speak out, because I wasn't using the clec's dsl.

Then they came for the bandwidth hogs -- and I did not speak out, because I was not a bandwidth hog.

Then they came for the internet video users -- and I did not speak out, because I was not an internet video user.

Then they came for me -- and there was no one left to speak for me.

danclan
join:2005-11-01
Midlothian, VA

danclan

Member

Re: Get everyone hooked on the internet then raise prices.

can we please not try to compare internet and phone systems to the holocaust...i'm just not seeing any comparison in any way shape or form...none what so ever...
Angrychair
join:2000-09-20
Jacksonville, FL

1 edit

Angrychair

Member

Re: Get everyone hooked on the internet then raise prices.

Get over your righteous indignation and think about the high concept of what I just said and you'll understand that people don't have to be dying for it to matter when people ignore encroachment of authority/power into matters groups or the individuals care about.
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danclan
join:2005-11-01
Midlothian, VA

danclan to Angrychair

Member

to Angrychair

Re: Get everyone hooked on the internet then raise prices.

There is nothing to think about, the two are dis-separate and cannot be compared. there is no indignation only that the reality of the one resulted the in the killing of millions and the other has to do with an offensive but hardly life shattering business practice

Z80A
Premium Member
join:2009-11-23

4 edits

1 recommendation

Z80A

Premium Member

Re: Get everyone hooked on the internet then raise prices.

Maybe you should get over yourself and think about it. He speaks of apathy and the consequences of it which is obvious to everyone but you. Those who don't give a crap while others are screwed, inevitably are themselves screwed in the end. It's really not that difficult of a concept to grasp and it is not by any stretch of the imagination limited to the Holocaust.

keithps
Premium Member
join:2002-06-26
Soddy Daisy, TN

keithps

Premium Member

Save me

Come save me from the ISP overlords, EPB FTTH. At least I'm hoping the smaller, independent, non-shareholder companies can provide decent internet service without trying to screw everyone.
iansltx
join:2007-02-19
Austin, TX

iansltx

Member

If one ISP balks though...

If there exists in a given area an ISP that offers an uncapped connection transfer-wise then that's a MAJOR selling point, and will get them a premium price or allow them to sell lower speeds for the same price, versus a competitor. When TWC talked about metered billing in San Antonio and Austin, Grande Communications immediately took the statement and ran with it, advertising that their plans have no caps. If any provider is willing to stick to uncapped internet to the point that they'll advertise it as a value-added feature, they for the short term get more customers and in the long term prevent a move to low-limit cap-and-tier pricing in that area.

Unless of course you're being throttled by your local loop provider...ahem Bell...

StevenB
Premium Member
join:2000-10-27
New York, NY
·Charter

StevenB

Premium Member

Re: If one ISP balks though...

The only reason this hasn't hit in the USA yet, is due to verizon. Once verizon hops on board to do this type of billing, it will come live. ATT/Time Warner/Comcast/Cox etc.. all have had their dream goals of metered internet, but verizon isn't hoping on board with it.

Cablevision isn't on board either because of the Verizon competition in all of their markets. But they'd love to do it as well

The little ISPs/MSOs i don't know what they'll do, but prob follow suit with the big boys.
iansltx
join:2007-02-19
Austin, TX

iansltx

Member

Re: If one ISP balks though...

Again, no cap = competitive advantage. If Verizon does cap their landline broadband it'll be upwards of 500GB in all likelihood. Otherwise they'd be running at ~5% of capacity.

As for CV, they've said straight up that they aren't going to cap-and-tier anyone. They took throttling off their 15/2 service a few years back and the way they run their network (fast and loose) there's no reason to do capping scare tactics.

Right now bandwidth pricing is at an all-time low, which means that "indie" providers can pick up enough to bring their bandwidth cost per gigabyte near zero, provided they can get transport to a major internet city. With the pipe open on that end, they can push whatever they want down the line to consumers, and will have a lot of excess capacity if they're running DOCSIS 3, DSL or FTTH. The most logical way to use this capacity in a competitive marketplace is to ratchet up speeds and increase or eliminate transfer caps, because if you're better than your competitor, people switch to you.
patcat88
join:2002-04-05
Jamaica, NY

1 edit

patcat88

Member

Re: If one ISP balks though...

said by iansltx:

Right now bandwidth pricing is at an all-time low, which means that "indie" providers can pick up enough to bring their bandwidth cost per gigabyte near zero, provided they can get transport to a major internet city.
Well getting your fiber just to the basement at the colo/meet me room can be a $1000 a month, then you might find out the only duct owner in the city is the ILEC and 1 or 2 CLECs that price 5% less than the ILEC in a duopoly. Or the ILEC rented all unused ducts to the peering center to force everyone to rent from them. To pay for urban construction to add ducts to the colo building you don't even own, you must be as rich as a silicon valley dot com start up in 1999. All the other CLECs in the building rent bandwidth or lambas from the ILEC or the CLEC in order to serve that building. Some cities have NIMBY "embargos" on street construction which mean no new ducts can ever be built again except by existing telecom providers under a maintenance or emergency exception. Some cities give exclusive telecom ROW rights to the ILEC to keep the ducts organized and mapped well in the city, even the CABLE COMPANY MUST RENT FROM THE ILEC to run its coax to serve the city. See »en.wikipedia.org/wiki/Em ··· y_Subway
rahvin112
join:2002-05-24
Sandy, UT

1 recommendation

rahvin112

Member

Re: If one ISP balks though...

Horseshit. I don't believe a word of what you just said about building utilities. I KNOW it's not true in my state and I doubt there is a state in the union where any of what you said is true. No city, county or state could legally block a Utility from using the public ROW as it would be a clear constitutional violation of equal protection. They can make it expensive and a hassle full of red tape but they cannot legally block it. Contrary to what people on here are have posted not even a franchise agreement with explicit language only allowing a single provider can stop an overbuilder. Such contract terms are unconstitutional and illegal.

Legal impediments aren't what stop overbuilding. What stops overbuilding is that building out a Last mile utility network is ultra expensive. Not even those circa 1999 dot coms had the kind of money to build out last mile. A single million+ metro area can cost upward of 10billion to wire once construction, easement and damages are figured in. The problem the overbuilder faces is once they spend the 10billion to wire the city the incumbent ILEC and cable company undercut pricing in the overbuilt area to prevent the overbuilder from being able to recoup the investment. This is what happened to RCN the cable overbuilder.

Nothing can prevent overbuilding, it would be completely unconstitutional to try and any city that tried would end up with a legal bill defending the measure with no success in preventing. You cite New York as the example, but what you didn't note was that anyone could overbuild in New York but the cost of construction is what stops it. Verizon is spending multiple billions to rewire a city they already have ducts in and it's the city with the highest density in the country. Imagine the cost of a city without ducting, infacstructure, CO's and everything else already in place. An overbuilder has to tear up streets, buy property for the CO's plant, build buildings and pay to repair every yard they tear up and it's more expensive now because most municipalities require everything to be buried now and that doesn't even include material costs. It's immensely expensive, probably the most expensive type of construction in the country because of the complexity and involvement of individual property owners who think allowing a cable through their yard is worth 1million dollars. And the final nail in the coffin of overbuilders is that most states have granted ILEC's and other primary utilities the power of eminent domain (to acquire needed property for the common good even if the seller won't voluntarily sell), something the over builder rarely has access to.
sonicmerlin
join:2009-05-24
Cleveland, OH

sonicmerlin

Member

Re: If one ISP balks though...

I think you`re being naive about the difficulty of overbuilding and cutting through all the red tape.

You`re also ignorant of the costs. One million = $10 billion? That`s 10,000 per person... in a metro area. So wiring up the entire US of 300 million would cost $3 trillion? Are you nuts?
rahvin112
join:2002-05-24
Sandy, UT

rahvin112

Member

Re: If one ISP balks though...

said by sonicmerlin:

I think you`re being naive about the difficulty of overbuilding and cutting through all the red tape.

You`re also ignorant of the costs. One million = $10 billion? That`s 10,000 per person... in a metro area. So wiring up the entire US of 300 million would cost $3 trillion? Are you nuts?
I said larger than a million. That's what the + means by the way, it means more than. I work in the civil projects industry, the red tape isn't difficult, it's always been cost of construction. Anyone stupid enough to argue it's the cost of the red tape doesn't know anything about the business and is talking out their ass.

»www.fundinguniverse.com/ ··· ory.html

RCN then acquired Residential Communications Network to form the foundation for McCourt's new vehicle to take on the entrenched telecommunications industry. When the realignment was complete in October 1997, RCN lost little time in raising $575 million in junk bonds to start building its communications network. The initial focus was on a corridor that stretched from Boston to Washington, D.C., a potential market of some 25 million households. McCourt's ambitious goal was to make customers out of nine million of them. Given that it would cost from $1,200 to $1,400 to wire each household, RCN was looking at a $12 billion price tag to build the Northeast network.

25 million households, $1,200 per home = $30,000,000,000 =$30 billion. This figure is the wire line installation costs. The one thing it doesn't cover is the plant and CO's.
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patcat88
join:2002-04-05
Jamaica, NY

patcat88 to rahvin112

Member

to rahvin112
said by rahvin112:

Horseshit. I don't believe a word of what you just said about building utilities. I KNOW it's not true in my state and I doubt there is a state in the union where any of what you said is true. No city, county or state could legally block a Utility from using the public ROW as it would be a clear constitutional violation of equal protection. They can make it expensive and a hassle full of red tape but they cannot legally block it. Contrary to what people on here are have posted not even a franchise agreement with explicit language only allowing a single provider can stop an overbuilder. Such contract terms are unconstitutional and illegal.
What if there is a law that says that the current ILEC network would be illegal to ever build again due to building code/safety/aesthetics/to promote competition/flying unicorns/save children/etc, and the current network is grandfathered?

Access to the ROW for a utility is a PRIVILEGE, NOT A RIGHT under law. We wouldn't have a PUC/PSC if it were a right.

You just said about grandfathered powers that existing utilities have that newcomers won't ever have.
said by rahvin112:

And the final nail in the coffin of overbuilders is that most states have granted ILEC's and other primary utilities the power of eminent domain (to acquire needed property for the common good even if the seller won't voluntarily sell), something the over builder rarely has access to.
If a city council votes no on your franchise or building permits, your screwed. Just 1 politician who didn't get a donation, and the process is over for you »www.nyc.gov/html/doitt/d ··· 2002.pdf
iansltx
join:2007-02-19
Austin, TX

iansltx

Member

Re: If one ISP balks though...

Fortunately, I'm not talking about NYC. I'm talking about areas where the local city governments don't have their heads firmly shoved where the sun don't shine and know that their towns will dwindle/die if they can't attract next-gen, preferably high-tech industry (and the workers that go with them) into the area. I'm not talking about towns where there's the ILEC deploying VDSL and the MSO pushing 50/10 DOCSIS 3. I'm talking about areas where the ILEC's nearest fiber is in the nearest city with population > 200,000 and you're in a town of 30,000, 10,000 or 3,000, and where (as such) the cable provider can upgrade (or not) at their leisure. In those towns you snag a few key business accounts as the new provider, then build out to lower-tier areas with the blessing of a city government that sees broadband as an economic development boon.

FWIW, costs are MUCH less than $10k per subscriber unless you're talking about very, VERY low-density areas, at which point you have no competition and an 80%+ take rate for whatever you can provide, as long as it marginally beats 3G service, which inevitably reaches 1000/500 and no more. Costs are closer to $2000 per subscriber, which are steep but something you can amortize over the long run. You just hang in there, compete on price when needed and compete on service quality and speed at all other times.

At any rate, I was talking about a provider who already has a network established and whose former bottleneck was cheap bandwidth availability. Building out a whole new network is expensive, but if you're competing against Frontier Communications might actually be a viable operation. Or if you're competing against CenturyLink and are willing to offer something better than 25/2 for $85 per month.
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hayabusa3303
Over 200 mph
Premium Member
join:2005-06-29
Florence, SC

1 recommendation

hayabusa3303

Premium Member

people need to

vote with there wallet.

chucky5150
Divers do it Deeper
join:2001-11-03
New Iberia, LA

chucky5150

Member

Re: people need to

I already am. I've cut off cable TV service and just use the internet for my tv watching needs.

gee can't wait for Cox to start doing something like this so I can switch over to the slower AT&T DSL.
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Ryokucha
join:2000-10-20
Ormond Beach, FL

1 recommendation

Ryokucha to hayabusa3303

Member

to hayabusa3303
Which is why more competition is needed, so people can do just that. If there was real competition in the market this wouldn't even be a story.

MxxCon
join:1999-11-19
Brooklyn, NY

MxxCon to hayabusa3303

Member

to hayabusa3303
if i only have 1 choice, there's not much i can vote with :\

Chuckles0
Premium Member
join:2006-03-04
Saint Paul, MN

Chuckles0

Premium Member

Re: people need to

said by MxxCon:

if i only have 1 choice, there's not much i can vote with :\
That's not what these guys say...

»www.youtube.com/watch?v= ··· GMxGq9rM

TechyDad
Premium Member
join:2001-07-13
USA

TechyDad to MxxCon

Premium Member

to MxxCon
Exactly. Where I live I have the choice of Time Warner Cable's Roadrunner or dial up. FIOS isn't available to my house yet and DSL seems more and more ignored as Verizon moves to FIOS.

So if Time Warner Cable instituted their dream caps, I'd have the choice of severely curtailing my Internet use (which doesn't involve things like downloading movies/music from P2P networks but does involve Netflix streaming), cutting Internet altogether (not really an option given that I'm a web programmer by trade), going back to dial up (again, not really an option) or paying Time Warner Cable more and more and more.

Oh yeah, those are some good options.

Bill Neilson
Premium Member
join:2009-07-08
Alexandria, VA

Bill Neilson to hayabusa3303

Premium Member

to hayabusa3303
said by hayabusa3303:

vote with there wallet.
And I agree but for some people, their votes can only go so far

I have cut all non-essential services from my TV/Internet but at some point, I do have to sign up for some of it.

I wish I had more choices not involving Sat. internet

Mashiki
Balking The Enemy's Plans
join:2002-02-04
Woodstock, ON

Mashiki to hayabusa3303

Member

to hayabusa3303
said by hayabusa3303:

vote with there wallet.
There is no voting with your wallet in many places in Canada. How many times has this been said?
Corydon
Cultivant son jardin
Premium Member
join:2008-02-18
Denver, CO

Corydon

Premium Member

Out of curiosity...

Does anyone have any hard figures (and good, trustworthy sources) on what the cost to a major ISP is per GB?

Perhaps putting some hard numbers out there about the markup that a $5/GB charge represents might shame ISPs into pulling back (given enough bad publicity).

•••••••••••

SoSad
@rr.com

SoSad

Anon

Hope someone will fight this

Holy crap! Hope our northern brothers and sisters fight this oppression!

SpaethCo
Digital Plumber
MVM
join:2001-04-21
Minneapolis, MN

SpaethCo

MVM

Increasing prices creates a market for competition

The key limiting factor that prevents upstarts from entering a market and providing ISP services is money. The existing LECs and Cable Cos already have infrastructure deployed under self supporting business models with Cable TV and Telephone service; internet access is just an add-on service. Any new player to the market has to start from scratch and deploy the access infrastructure and provide the service.

If the incumbent providers want to keep raising prices, eventually it becomes cost effective for others to build out their own network access to compete.

••••••••••••••

erniewitt
@cia.com

erniewitt

Anon

Monopolies and ARPUs

What do you expect when you have a monopoly. All the CEO's have to look at now is the prized ARPU. When shareholders look at the quarterly report, they look at ARPUs, not customer satisfaction (as there is no competition to switch to). I hope minister Clement would give incentives to spur on new competition in broadband, or at least give some help to 3rd party ISPs to wean themselves off Bell.

mbaha
join:2009-03-01

mbaha

Member

no deal!

that sucks!

Dominokat
"Hi"
Premium Member
join:2002-08-06
Boothbay, ME

1 edit

Dominokat

Premium Member

Way to kill innovation

This comes to the states I'll go back to dial up.
It will be cheaper.....
k1ll3rdr4g0n
join:2005-03-19
Homer Glen, IL

k1ll3rdr4g0n

Member

Rates rise and speeds decrease/don't move

Anyone else seeing this trend?

In the US many ISPs have upgraded to DOCIS 3....but the price is up there so very few people are going to pay for it...which begs the question...why bother? If your ROI will be minimal...why not just jack the rest of the customer's speeds up?
That is, after all, competition. Oh wait.

On the other side of the fence, I am a business customer with a contract. If Comcast even THINKS about jacking my rates, they will be breaching the contract and say goodbye to a customer. If I were still a residential customer, I would ask, no demand a contract locked price. If the ISP is unwilling to give one, I would contact the AG because then obviously this gives freedom to ISPs to do whatever wacky things with the prices as they see fit (usually they increase and stay increased). This is ESPECIALLY important when you have a single cable provider in a given area.

Oh well, what do I know.

conqanon
@rogers.com

conqanon

Anon

FFS

Every March Rogers raises their prices. I don't understand why they can do this. I understand your a business, but for fuck sakes.
confq
join:2008-04-26
Toronto, ON

confq

Member

Go Rogers!

Every March they raise prices on different parts of their services. Oh to improve customer services blah blah blah wtfever. I just signed one year contract for 47 dollars a month for express with 95 GIGS a month. I am not into warez so this should be good. I was going over my 60 GB by 10GB every month just from watching HD podcast, streaming music, youtube and xbox 360 online gaming.

I wish WIND Mobile would offer some crazy fast wireless service for like 30 bucks a month unlimited, Rogers would shit their panties.. Then again I prob don't have a clue what I am talking about. CRTC would probably be paid to vote down anything like that from Rogers lol
mbourd25
join:2005-09-14
Hammond, ON

mbourd25

Member

Better then Videotron

At least it's better then Videotron. Videotron charges $7.95 overage on there 7.5 megs plan and a 30 gigs cap.
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tmc8080
join:2004-04-24
Brooklyn, NY

tmc8080

Member

pushing towards...

the public up north should just get fed up with this crap from isps and push forward with rate regulation.. apparently the carriers have no interest in treating the customers correctly & fairly.. so their hands must be forced to adjust the bills by LAW.
33358088 (banned)
join:2008-09-23

1 edit

33358088 (banned)

Member

truyst me tha public is a lot more fed up then you think

govt that keeps giving it self paid hilidays
scandels the bribes condoning torture
screwing us buy selling us out on softwood lumber and copyright

make ysure you all vote conservative again in next election OK
great for the harper pocket NOT FOR YOU

and to think back years ago when rogers started theyd give you a free month to sign people up (years ago btw)

IM SORRY as are others
and i help now a rogers refuge....teksavvy rules

JunjiHiroma
Live Free Or Die
join:2008-03-18
Renfrew, ON

JunjiHiroma

Member

It's all to protecting their Big Fat TV Profits

As I said ,it's the cable AND the telco's wanting to keep their TV Profits in check,that's why Roger's (and soon others) is doing this.If this keeps up then monetization of the net will happen quicker then usual
33358088 (banned)
join:2008-09-23

33358088 (banned)

Member

hey idea time

i know crazy man tlak time but why dont you all gather up locally and donate some bucks together over the year and start a wireless tower

then when we have hundreds a these accross canada
we then do a link up and say UP YOURS TO THEM

others would have better ideas how to get there and maybe a TSI and WIND might be in the process of the end game or maybe even TSI techies could be your local installers or such

the idea being if i have a 60GB cap and you do and so do ten others
thats 720GB of bandwidth
you could set aside 30GB to get a certain set a stuff
then trade it via the local transmitter

remember those levied cdrs too keep shit loads on hand and any whiners you can get bent im paying 26cetns a cdr for the right and your stupid paying more
END OF STORY
not my fault the agency collecting it dont pay people
that for the paid vacationing govt to deal with

n2jtx
join:2001-01-13
Glen Head, NY

n2jtx

Member

Pretty Bad Up North

My youngest sister and her family live in Mississauga. I am stunned at how bad Canadians have it with overprices cell phone service as well as overpriced Internet service. With two adults and two teenagers active on the Internet, they are limited to 60GB a month before they start incurring overages. That limits four people to 2GB/day and my teenage Nieces love to watch videos and listen to music so it is a tough time for all when they start to approach the limit.

I contrast that to Optimum Online where I have 15/2 service for $49.95/month without any caps. If I had to live in Canada, I would not be a happy Internet user or cell phone customer.
33358088 (banned)
join:2008-09-23

1 edit

33358088 (banned)

Member

another idea

we start a real revolution and grab all the politicians and big isps drop them on PEI and NUKE the island

of course we need to move all that red sand for the potatoes but hey works for me
easy quick solution

we then make a law saying no more lobbying of anyone in any govt position on penalty of PEI'ing you

we then epxand this to kicking out CRIA and put a panel of citizens in charge of the levy and the CRTC

END OF STORY
/sarcasm

oh and if it gets too bad in relaity and people leave th net guess how they will trade
/me walks over to buddies with his TB drive
and so on

YOU LOST HOLLYWOOD PERIOD cat was out of the bag a long long time ago and 3 generations all has know how to use p2p and other tech

with a paralyzed minority govt that seems ot be continuing and the ndp each of these elections to seemingly growing little by little as the greens do , how long before all your corporate buying power has no value

think about that long and hard each year more older conservatives and liberals die off

WE the people will speak and be heard ....eventually
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